Title: Shipping Disruption in the Middle East Due to Iran Conflict
LONDON/SINGAPORE: Insurance companies are halting war risk coverage for ships in the Middle East Gulf following escalating tensions in Iran. This situation has led to damaged vessels and even casualties.
Shipping through the Strait of Hormuz, a vital passage that carries around 20% of the world’s oil, has nearly stopped. This follows a series of attacks as Iran responded to U.S. and Israeli military actions. Recently, one tanker caught fire, several others were damaged, and roughly 150 ships are currently stuck in the area.
The disruption has led to a spike in oil and European natural gas prices, with Brent crude futures rising by as much as 13%. The conflict has prompted shutdowns in oil and gas production across the region.
As reported, about 150 vessels, including oil and LNG tankers, were anchored in and around the Strait of Hormuz. This forms about 10% of the world’s container ships, and delays could lead to cargo piling up at ports in Europe and Asia, according to Jeremy Nixon, CEO of Ocean Network Express, a container carrier.
Iran has stated it has closed navigation through the crucial waterway, prompting concerns among Asian governments and refiners about oil supplies. An Iranian commander threatened to fire on any ships attempting to pass through the Strait, which measures just 21 miles wide.
In one of the recent incidents, Iran’s Revolutionary Guards announced that the Honduran-flagged vessel Athe Nova was on fire after being struck by drones. Additionally, the U.S.-flagged tanker Stena Imperative was damaged by aerial strikes while docked in the Gulf, resulting in the loss of a shipyard worker’s life.
